Manufacturing Overhead Quiz and Test

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Selling, general and administrative costs are part of manufacturing overhead.

True

False

Factory overhead and burden are terms used as alternatives for the term __________ overhead.

Which of the following are part of manufacturing overhead?

Direct Labor

Indirect Labor

Office Depreciation

The factory maintenance department and the factory administration department are examples of __________ departments.

To be in compliance with generally accepted accounting principles, selling and administrative expenses and interest expense should be allocated to the cost of products manufactured in order to properly value inventories on a manufacturer's balance sheet.

True

False

Manufacturing overhead must be assigned to both work-in-process inventory and finished goods inventory for external financial reporting purposes.

True

False

Only direct manufacturing costs are assigned to inventories and cost of goods sold.

True

False

Commissions paid to sell products are reported as part of the cost of goods sold.

True

False

Traditional costing is more likely to be associated with allocating manufacturing overhead on the basis of __________.

Activities

Machine Hours

10.

The depreciation on the machines used on the manufacturing line is considered to be __________ manufacturing cost.

A Direct

An Indirect

11.

In general, manufacturing overhead has increased as a percentage of product costs during the past 80 years.

True

False

12.

The use of a plant-wide rate will be more equitable than the use of departmental rates for allocating manufacturing overhead.

True

False

13.

Manufacturing overhead costs are also known as indirect manufacturing costs.

True

False

14.

Using only machine hours for assigning manufacturing overhead will likely result in too ___________ costs for low volume products.

Little

Much

15.

The salary of the president of a manufacturer is part of the manufacturing overhead costs.

True

False

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Manufacturing Overhead (Practice Quiz)

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